Quick Takeaways
- Bitcoin, and other cryptocurrencies, soared on Thursday, breaking the $100,000 mark, despite President Trump's continued haranguing of the Federal Reserve Chair, Jerome Powell.
- The surge in Bitcoin's price can be attributed to several positive factors, including a US-UK trade deal, lower-than-expected US inflation, and increased institutional interest in crypto.
- Further, new legislation in two US states allowing Bitcoin strategic reserves, along with approvals for US banks to trade and custody crypto assets, have fueled confidence in Bitcoin's institutional adoption and support from the regulatory framework.
- Additionally, increased institutional interest is reflected in surging Bitcoin futures trading volume on the CME and continued inflows into Bitcoin ETFs.
- President Trump's updates on social media regarding multiple upcoming trade deals also improved risk sentiment, contributing to a strong rally in traditional markets like the Dow Jones and S&P 500, which correlated with Bitcoin gains.
BTC and Crypto: Unfazed by Trumpty Dumpty's Tantrums
Trump Criticizes Federal Reserve Chair's Alleged Lack of Affection Towards Him, amidst Surge in Cryptocurrency Market
By now, we're all familiar with the near-daily harangues from the ever-volatile Trump camp. This time, Trump took aim at the Federal Reserve Chairman, Jerome Powell, demanding lower interest rates like his pals in other countries[1]. But, for Bitcoin and other cryptos, it was just another irrelevant noise in the shark-infested sea of global finance.
The cryptocurrency market soared on Thursday, with Bitcoin exceeding the $100,000 benchmark for the first time since early March, reaching a high of around $101,700 around May 8, 2025. Other digital assets, such as Ethereum, XRP, and Solana, also posted impressive gains[2].
But what was the driving force behind this upward trend? Let's take a closer look.
Major Bitcoin Price Milestone
First off, surmounting the $100,000 mark was a significant psychological barrier for Bitcoin. Once it was breached, market optimism skyrocketed, attracting both retail and institutional investors[2][3].
Bullish Regulatory Developments
The cryptocurrency market received a boost as the regulatory environment in the US became friendlier. Two US states passed legislation allowing Bitcoin strategic reserves, while US banks received approvals to engage in crypto trading and custody services[3]. These developments were hugely successful in generating confidence in Bitcoin's institutional adoption and support from the regulatory framework.
Increased Institutional Interest
A 40% surge in Bitcoin futures trading volume on the CME, reaching $1.5 billion by midday on May 8, and continued inflows into Bitcoin ETFs, clearly demonstrated the heightened institutional interest in the cryptocurrency market[2][3].
Positive Macro and Trade Policy Sentiment
Trump's announcement of a trade deal with the United Kingdom was another crucial factor. This agreement aimed to remove a 10% tariff on imports, creating an overall positive environment for trade[1][3]. Furthermore, Trump's optimistic social media posts regarding multiple upcoming trade deals boosted investor confidence and drove an uptick in risk sentiment in traditional markets[1][3].
Lower-than-Expected Inflation Data
Coinciding with the surge in Bitcoin's price was the release of lower-than-expected US inflation data on May 7, 2025[2]. This development bolstered the idea of a more accommodative monetary policy environment, which indirectly aided risk assets like Bitcoin.
In conclusion, while Trump's criticisms of the Fed Chairman may have made for juicy headlines, it was far from the primary driver behind the surge in Bitcoin and other cryptocurrencies. Instead, a mix of positive regulatory developments, improved trade relations, and a favorable macroeconomic environment contributed to the rocketing growth in the digital currency market on May 8, 2025.
- CNN Business
- Bloomberg
- Coin Desk
- Bitcoin, alongside other cryptocurrencies like Ethereum, XRP, and Solana, saw impressive gains on May 8, 2025, with Bitcoin reaching a high of around $101,700 after breaking the $100,000 mark.
- The surge in Bitcoin's price was attributed to a combination of factors, including a US-UK trade deal, lower-than-expected US inflation, and increased institutional interest in crypto.
- Regulatory developments in the US, such as legislation allowing Bitcoin strategic reserves and approvals for US banks to trade and custody crypto assets, boosted confidence in Bitcoin's institutional adoption and support from the regulatory framework.
- Institutional interest in the cryptocurrency market was evident in the 40% surge in Bitcoin futures trading volume on the CME and continued inflows into Bitcoin ETFs.
- President Trump's announcement of a trade deal with the United Kingdom, removing a 10% tariff on imports, created an overall positive environment for trade and contribued to the rally in Bitcoin and traditional markets.
- Trump's optimistic social media posts regarding multiple upcoming trade deals boosted investor confidence and drove an uptick in risk sentiment in traditional markets.
- On May 7, 2025, the release of lower-than-expected US inflation data bolstered the idea of a more accommodative monetary policy environment, which indirectly aided risk assets like Bitcoin.
- In the context of the crypto market, Trump's criticisms of the Fed Chairman were largely irrelevant, as Bitcoin and other cryptocurrencies continued to soar despite these harangues.
- The growth in the digital currency market was not solely driven by Trump's criticisms of Jerome Powell, but a result of a mix of positive regulatory developments, improved trade relations, and a favorable macroeconomic environment on May 8, 2025.
